BBC to review salary deals for highest-earning presenters

The BBC has announced a review of the salaries of its highest-earning presenters. The move comes after the corporation faced fierce criticism for issuing contracts to stars such as Jonathan Ross, who received a reported £18m last year.

The review, ordered by the recently appointed chairman of the BBC, Sir Michael Lyons, is likely to look at the remuneration awarded to Ross, together with those of Graham Norton, Terry Wogan and Chris Moyles.

According to documents leaked last June, Ross secured the deal after signing a three-year contract. Norton is said to have been paid more than £5m and Little Britain actors David Walliams and Matt Lucas £6m after tying themselves to the corporation for a similar period. The claims over Ross' pay deal in particular sparked controversy, not least from BBC employees angry over the size of payments while redundancies and cutbacks were being made elsewhere. Critics argued that it was behaving little differently to commercial stations. Management argued that it needed to pay market prices in order to retain stars who may be tempted to join rival channels.

The inquiry, which will be confirmed when the BBC publishes its annual report next month will assess whether the licence fee payer is getting value for money by the sums it pays to its most popular presents.

It will begin next year, but will not look at the pay deals of individual stars. It will, however, consider whether the corporation is fuelling high wage demands rather than responding to them.

A BBC Trust spokeswoman said: "For the trust to do its job properly as the steward of the licence fee and ensuring quality programmes that create maximum value for the public, it needs to understand the big issues which have the greatest impact on what appears on screen and radio. Talent costs understandably raise questions for the public. So the trust must ensure it has a proper understanding of how the BBC operates in these markets to satisfy itself that the greatest value is being created."

At the time the Ross deal was reported, the BBC, which had been locked in a bidding war with Channel 4 over the presenter and was reported to have eventually agreed to match the sum they were offering, refused to comment on the figures involved.

The size of the payouts has created resentment in the corporation but few have criticised the BBC in public over the issue. Last year, however, Theo Leggett, its Europe business reporter, wrote in the BBC's in-house magazine: "At a time when managers are culling staff in the name of 'value for money', it is little short of obscene that a single performer, however talented, can earn (a reported) £6m a year. That's enough to pay 200 people an annual salary of £30,000.

"Management has been trying to close 330 posts in news alone to save cash. The implication is clear: the BBC is willing to compromise its news operation in order to secure the services of one supposed ratings-grabber. I'm not sure that's what public service broadcasting is supposed to be about." It is anticipated that, later this year, as many as 1000 staff could go, with cutbacks expected in its news departments.

The big earners

Jonathan Ross

£18m signed in 2006, taking him to 2010, to host Friday Night with Jonathan Ross, Film 2006 and a Saturday morning show on Radio 2.

Graham Norton

£5m for a three-year contract, to end in 2009, to work exclusively for the BBC. Has hosted How do you Solve a Problem Like Maria and Strictly Dance Fever.

David Walliams and Matt Lucas

Signed £6m for three-year contract binding them to the BBC, to include a new comedy show to be screened this autumn.

Sir Terry Wogan

Gets £800,000 a year for his breakfast show on Radio 2 but criticised the BBC for "overpaying" stars, saying: "You might say the lunatics have taken over the asylum."